That's actually not a bad idea at all. Given our lack of resources, focusing on niche areas will reduce the level of competition while raising the likelihood of success. That's because unknown to most lay people, Phase III clinical trials for new drugs involves showing improved clinical outcome of the experimental drugs vis-a-vis the existing gold standard for treatment. If the existing treatment is "nothing" or something purely palliative, then passing Phase III is practically a cinch if the new drug actually works.
Incidentally, knowledge of how the clinical trial process works is also why I'm always deeply skeptical whenever our local media reports (always in 'breathless tones') on how compound X is now being tested by Singapore company Y in clinical trials (invariably Phase I and II). I'm like, yeah, whatever, hit the snooze button and get back to us after they've passed Phase III please.
In addition, it might come as a shock to most people that it's distressingly often that articles like this get published. The truth is that coming up with a revolutionary new treatment that dramatically improves the clinical outcome for patients is as rare as a ... revolution. Many pharmaceutical companies are motivated to engage in all kinds of research chicanery in order to get their drugs approved, make them look like real performers, and then rake in the money while their drugs are still on patent.
So developing drugs for rare diseases is, in a way, less susceptible to temptations of intellectual dishonesty. Certainly, the market for such drugs is smaller and less lucrative, so the temptation is correspondingly less.
However, Alex Matter is right in saying that "Once you publish these results, other scientists and doctors will sit up and take notice, and they will soon find that the drug can treat other diseases as well." What Matter is referring to, termed off-label use, can substantially boost the profitability of a drug. He mentions Glivec as an example. I can immediately think of another, Latisse, which I suspect might be a real money-spinner.
Finally, with climate change now gathering force, tropical diseases that were nearly as ignored as rare diseases may rise in economic importance. Focusing on drug discovery and development in this related area could well be an excellent investment as well.